Foundations of Modern Macroeconomics

Ben J. Heijdra received his education in the Netherlands and in Canada. Before joinin the Faculty of Economics and Business of the University of Groningen in the Spring of 1998 he held academic positions at various universities in Australia and the Netherlands. His research focuses on policy-relevant (theoretical) macroeconomics. Topics include ageing and macroeconomic performance, annuitization and the macroeconomy, and environmental macroeconomics. Heijdra is a Senior Researcher of Netspar, a network dedicated to the study of ageing and pension issues, and a Fellow of CESifo (Munich). He has been on the editorial board of De Economist since January 2005.

This thoroughly revised and expanded version of Ben Heijdra's successful textbook continues to do an excellent job of keeping up with the current developments in macroeconomics and presenting them in a way that makes this material accessible to advanced undergraduate students. I find its progression from intermediate macroeconomics, through advanced macroeconomics, to the dynamic stochastic general equilibrium, which enables these diverse developments to be presented in a unified framework, to be particularly appealing.

• 1: Review of the AD-AS Model 2: The open economy 3: Dynamics in aggregate demand and supply 4: Perfect foresight and economic policy 5: Rational expectations and economic policy 6: The government budget deficit 7: A closer look at the labour market 8: Search in the labour market 9: Dynamic inconsistency in decision making 10: Money 11: New Keynesian economics 12: Exogenous economic growth- Solow-Swan 13: Exogenous economic growth- Ramsey-Cass-Koopmans 14: Endogenous economic growth 15: Overlapping generations in continous time 16: Overlapping generations in discrete time 17: Decision making in a stochastic environment 18: DSGE- New Classical models 19: DSGE- New Keynesian models